Gunns plans to sell Mitre 10s to cut debt

Woolworths
and Bunnings are contenders to buy the Mitre 10 outlets, according to a source.

Besides owning one of Australia’s largest collection of forests, Gunns operates hardware and building supply stores in Tasmania and two specialist timber stores, with wholesale timber outlets in most capital cities.

The sale has been announced as the company comes under pressure from shareholders following a slump in earnings and its shares.

Gunns chairman
John Gay
told a Tasmanian newspaper last week that he was being pushed by the largest shareholders of the company to step down.

A source close to Gunns said the other board members are concerned about the issue going public. One major shareholder told The Australian Financial Review that Mr Gay is a “tenacious guy" and will not easily bow out of a company he helped build over nearly 35 years.

Gunns is moving ahead with a new strategy that will leave it with four divisions: the pulp mill; plantation assets; the sawmilling business; and construction, hardware stores and the Tamar Ridge wine business.